ITEM 4 People Service contract renewalC1Ty 0
ot e F 0 -
MINNESOTA g
DEPARTMENT INFORMATION
Requestfor
City Council Action
ORIGINATING DEPARTMENT:
Administration
REQUESTOR:
Lori Johnson, City Administrator
MEETING DATE:
February 20, 2013
PRESENTER(s):
Lori Johnson, City Administrator
REVIEWED BY:
Andy MacArthur, City Attorney
ITEM #: 4
AGENDA ITEM DETAILS
RECOMMENDATION:
Provide notice of.cancellation to PeopleService, Inc. as required by the current contract to preserve the
City's ability to renegotiate or terminate the contract.
ARE YOU SEEKING APPROVAL OF A CONTRACT? IS A PUBLIC HEARING REQUIRED?
No I No
BAC KGROUNDMUSTIFICATION:
The City currently contracts with PeopleService, Inc. for operation of the City's water and sewer
systems. The current five year contract contains an automatic renewal clause unless written notice of
cancellation is given 90 days prior to the date of expiration. Thus, if any changes are requested to the
contract or if the contact will be cancelled, notice is required by March 9, 2013.
When the annual approval of PeopleService, Inc.'s Consumer Price Index (CPI) was approved on June 25,
2012, it was noted that the continuation of this contract would be reviewed in 2013 consistent with the
City's strategic planning goal to "assess the efficiency and effectiveness of City services." The Council
concurred that a decision on the contract would be made in 2013.
The current contract amount paid to PeopleService, Inc. is $580,380 of which $96,427' is for chemicals
a n d maintenance costs. In the past, a C1 P a di ustm e nt has been required by the contract
SUPPORTING DOCUMENTS: x o ATTACHED u NONE
0 Resolution Directing City Staff to Serve Notice of Cancellation of Operation and Maintenance
Agreement on PeopleService, Inc.
0 Current PeopleService, Inc. contract and addendurns
POSSIBLE MOTION
Please word motion as you %yould like it to appear in the minutes.
Motion to approve Resolution 2013-11 Directing City Staff to Serve Notice of Cancellation of Operation
and Maintenance Agreement on PeopleService, Inc.
BUDGET INFORMATION
FUNDING: I BUDGETED: OYES
o NO
ACTION TAKEN
o APPROVED AS REQUESTED o DENIED ii TABLED a OTHER (List changes)
COMMENTS-
CITY OF OTSEGO
COUNTY OF WRIGHT
STATE OF MINNESOTA
RESOLUTION NO.2013-11
RESOLUTION DIRECTING CITY STAFF TO SERVE NOTICE OF
CANCELLATION OF OPERATION AND MAINTENANCE
AGREEMENT ON PEOPLESERVICE, INC.
WHEREAS, the City of Otsego (OTSEGO) and PEOPLESERVICE, INC.
(PEOPLESERVICE) entered into a five year Operation and Maintenance
Agreement dated June 9, 2013; and
WHERF,AS, said Agreement was Amended on July 1, 2009 and April 1, 2010,
neither amendment affects the conditions of Agreement termination; and
WHEREAS, Article V of the Agreement states that the Agreement will
automatically renew for successive one year terms unless written notice of
cancellation is given by either party no less than ninety (90) days prior to the date
of expiration.
NOW THEREFORE BE IT RESOLVED by the City Council of the City of
Otsego, Wright County, Minnesota as follows:
City staff are hereby directed to cause written notice of cancellation of the
Operation and Maintenance Agreement to be delivered to PEOPLESERVICE
more than ninety days prior to the expiration of the Operation and Maintenance
Agreement pursuant to the terms and conditions of that Agreement.
ADOPTED this 20"' day of February, 2013.
MOTION made by Council Member and seconded by
Council Member a
IN FAVOR:
OPPOSED:
CITY OF OTSEGO
Jessica Stockamp, Mayor
Tam i Loff, City Clerk
OPERATION AND MAINTENANCE AGREEMENT
This Operation and Maintonance Agreement (the "Agreement") dated as of
20081 is between the City of Otsego, Minnesota, a municipal corporation (the "Owner"), whose
address is 8899 Nashua Avenue NE, Otsego, Minnesota 55330} and PEOPLESERVICE, INC.,
and its successors and assigns (" Poop leService") , whose address is 209 S. 19th Street, Suite
555, Omaha, Nebraska 68102.
RECITALS.:
WHEREAS, Owner is the owner of a municipal water and wastewater treatment facility
as described in Exhibit A to this Agreement the "Facilities"); and
WHEREAS, Owner desires to engage PeopleService to operate and maintain the
Facilities on behalf of Owner and PeopleService desires to accept such engagement, all upon
the terms and conditions hereafter set forth; and
WHEREAS, Owner is authorized by law to enter into this Agreement.
NOW, THEREFORE, in consideration of the premises and the mutual covenants herein
contained, the parties agree as follows:
ARTICLE I -SCOPE OF SERVICES
1A Commencing on July 1, 2008, or such other date mutually acceptable in writing to
PeopleService and Owner (the "Effective Date"), PeopleService will provide all routine
operation and maintenance of Owner's Facilities on a 7 day per week basis within the design
capacity of the Facilities as described in Exhibit A to this Agreement ("Description of
Facilities"). The routine operation and maintenance services to be provided by PeopleService
are further described in Exhibit B of this Agreement.
H*AvAYvAfscntfcClot seqo.wp6 I
1.2 Commencing with the Effective Date of this Agreement, PeopleService shall
continue the use of its standard operating procedures and preventive maintenance and
process control programs, including documentation of operation and maintenance procedures
conducted for the water and wastewater utility system, Such records shall be available for
inspection by Owner at all reasonable times.
1.3 PeopleService will be responsible for expenses incurred in the routino operation and
maintenance of the Facilities, including personnel services, communication set -vices consisting
of three (3) phone lines and the high speed internet service (electricity, natural gas and diesel
fuel used for the backup generator shall remain the responsibility of the Owner), chemicals
(subject to the provisions contained in Section 4.3 of this Agreement), materials, supplies,
contracted services, insurance, and equipment repair (subject to the provisions contained in
Sections 1.4 and 2.1.b of this Agreement).
M PeopleService shall provide all required maintenance to preserve the existing life of
all assigned equipment and vehicles of the Facilities. PeopleService will bear the expense of
maintenance and repair of all equipment, physical facilities, and vehicles assigned for
PeopleSer&e'S arse, except for capital replacement expenditures as defined in section 2.1 (b),
provided that such expense does not exceed a maximum annual maintenance/repair
(noncapital) expenditure of $30,000 for tho first year of this Agreement. In subsequent years,
the maximum annual maintenance/repair expenditure will be increased by the C.P.l.
adjustment contained in section 4,2 of this Agreement. In performing maintenance and
repairs, PeopleService will perform in an economical manner and make all reasonable efforts
to remain below the annual maintenance/repair expenditure amount while remaining in
compliance with all applicable regulations. PeopleService will refund to Owner any unused
monies less than the maintenance/repair expenditure amount, In the event that such
expenses approach or oxcood this maximum annual amount, PeopleService shall promptly
notify Owneri
. Any repair expenses n excess of the iflaxinium amount set forth in this
provision shall be approved by Owner. PeopleService shall invoice Owner the amount of
maintenance/repair expenses in excess of the maximum annual maintenance/repair limit set
forth in this provision at the and of the 12-tinoath period, Owner shall reirnburse PeopleService
. for such excess expenditures.
H:mvvAfscntrot\0tsego,wp8
1.5 PeopleService will provide properly certified employees for the staffing of Facilities.
Backup services will ba providod by PeopleService corporate personnel. In addition,
PeopleService will be on call 24 hours per day, 7 days per week, for emergency situations.
1.6 PeopleService shall advise Owner and serve as Owner's liaison to regulatory
agencies and industrial users in matters related to the operation of the Facilities, However,
PeopleSeivice will not act as, or provide, legal counsel in this capacity.
17 PeopleServIce will SLIperviso all regulatory compliance and financial transactions
pertaining to the day-to-day operation of the Facilities. Subject to the limitations of this Section
1,7, PeoplaService shall operate the Facilities in cornpliance with state and federal regulatory
requirements. PeopleService will pay all fines imposed for process upsets and violation of
discharge limits unless the process upsets or violations are attributable to:
(a) Flows or pollutants which are not within the Design Capabilities of the Facilities;
pollutants Include, but are not limited to soluble oil, heavy metals, excessive
suspended sollds and excessive organic loadings;
(b)
Ther alfunction or failure of equipment which is not solely due to the negligent
act$, errors or onnissions of PeopleService;
(c) Construction activities which are undertaken to improve the wastewater
treatment process but which are beyond the porating scope of services of
PeopleService as delineated in this Articlo 1; or
(d) Discharges from industrial facilities in violation of any pretreatment standards
applicable to those discharges.
In no event shall PeopleService be responsible for the payment of state or federal fines
imposed or damages, attorney fees, and court costs awarded as a result of actions, Inactions,
process upsets or violations which occurred prior to or existed on the Effective Date of this
Agreement, and which are not due solely to the negligence of PeopleService, nor shall
HmvAWscnf(chots egomp6
PeopleService be rosponsible for payment of any fines, penalties, damages or attorney's fees
resulting from requiroments not expressly assumed by PeopleService herein, including any
reporting requirements.
With regard to potable water supplies, PeopleService will not be responsible for inherent water
quality that falls to meet specifications of the Safe Drinking Water Act and amendments thereto
concerning inorganic chernicals, pesticides, volatile organic chemicals, synthetic organic
compounds, load and copper standards. However, PeopleService will use its best efforts to
treat Owner's potable water supplies to meet drinking water standards.
1.8 PeopleService shall exercise the due care in performing its obligations and duties
under this Agreement which is normally and reasonably provided with respect to similar
contract services.
1.9 PeopleService will provide and maintain at all times during the term of this
Agreoment the following minimum Insurance coverage:
(a) Statutory Workers' Compensation Insurance in compliance with the laws of the
stato of Minnesota which has jurisdiction of PeopleService employees engaged in
the performance of services herounder; together with Employers Liability coverage
in the amount of $500,000 for each ']incident;
(b) General liability coverage of at least $5,000,000 combined single limit, each
occurrence, for bodily Injury and property darnage with Owner named as additional
insured, and
(c) Comprehensive auto liability insurance which shall include $500,000, combined
single limit coverage for bodily Injury and property damage.
PeopleService will furnish Owner with Certificates of Insurance as evidence that policles
providing the required coverage and limits are in full force and offect. Such policies shall
provide that no less than thiel y (30) days' advance notice of cancellation, termination or
RmNAfs c n (rc t\O I s e g omp 6 4
I
alteration shall be sent directly to PeopleService and Owner.
I
ARTICLF. 11, RESPONSIBILITIES OF OW
2,1 As part of this Agreement Owner agrees to assunie the following responsibilities:
(a) OwnBr shall maintain in full force and effect, in accordance with their respective
terms, all guarantees, warranties, easements, permits, licenses and Other similar
approvals and consents received or granted to Owner as owner of all Facilities and
component parts thereof;
(h) Owner shall be responsible for all capital replacement and major
maintenance/repair expenditures which are defined as nonrecurring expenditures
greater than $1,f , that Owner determines necessary and required, provided that
PeopleService will first be consulted for Justification and need;
(c) Owner shall be responsible for filing, obtaining, and maintaining current water
supply operations permit and 1 permit for discharge of wastewater,, wellhead
protection plans, DNR water appropriation reports, DNR water emorgency plans
and conservation plans, mercury minimization plans, phosphorus management
plans; and for filing all re Dire reports under the Emergency Planning and
Cor MUnIty Right -To -Know Act or any other statute or authority as well as the
publishing of the annual COnSUrner Confidence Report (CCR) required by the Safe
DrinkIng Water Act; provided, however, PeopleService shall assist Owner with
preparing these filings and reports and shall provide ongoing assistance regarding
the maintenance of these permits, plans and reports;
(d) Owner shall at all tinies provide access to the Facilities for PeopleService, its
agents and employees;
(e) Owner shall provide PeopleService the use of all existing equipment owned by
Owner, Including a plow/hoist truck, necessary for the operation and maintenance
of the Facilities and warrants that such operating equipment is in good condition;
H:mvMfscn1r00tsego.wp6
(f) Owner shall be responsible for all damage to the Facilities, or thereof,
PeopleSeivice equipment on site, and all resulting liability to any and all third
partles, when SLIch damage and/or liability are caused by flood, fire, acts of God or
other force majeure events, civil disturbance, extreme cold temperatUres, excessive
subsoil moisture, or misuse of property to the extent Owner was negligent
regarding the misuse of such property;
(g) Owner shall be responsible for all fines Imposed for process upsets and
violations of discharge limits attributable to the operation and maintenance of the
Facilities to the extent set forth in Section 1.7 as wollas fines imposed for failure to
report as required by Section 2.1 (c);
(h) Owner shall designate an individual to act as liaison with PeopleService in
connection with the performance of services by PeopleService under this
Agreement;
(i) Owner shall be responsible for all property, excise and other taxes assessed on
the Facilities; I
0) Owner shall bear all costs incurred as a result of regulatory requirements not in
effect on the Effective Date of this Agreement; and
(k) Owner agrees to provide up to 700 hours of labor frorn RS MUnicipal employees
to assist PeopleService with routine fire hydrant flushing and manhole inspections,
2.2 Owner shall maintain In full force and effect all existing policies of property and
general liability insurance pertaining to the Facilities. Owner shall furnish Peopleservice with
Certificates of Insurance as evidence that such policies are in full force and effect under such
policles. Such policies shall provide that no less than thirty (30) days' advance notice of
cancellation, termination or alteration shall be sent directly to PeopleService and Owner.
2.3 Owner shall Indemnify and hold PeopleService, its officers, employees and agents,
H:mYMfscn1rc1101sago,wp6
harmless under this Agreement for any and all lair s, damages, costs or expenses caused by
malfunction or failure of the Facilities or any components thereof or other liability or loss
including injury, death, or damages to any person or property related in any way to the
performance of this Agrooment to the extent such claims, damages, costs, expenses, liability
or loss are caused by the negligent acts, errors or omissions of Owner, Additionally, Owner
shall indemnify PeopleService, its officers, employees and agents harmless for any and all
fines, Penalties, attorneyls fees and damages resulting from Owner's failure to comply with
permitting, reporting or other statutory or regulatory requirements which are the responsibility
of the Owner. This provision shall survive the termination of this Agreement.
A
Ick
III , RESPONSIBILITIES OF PEOPLESERVI%.ov.
3.1 PeopleService shall indemnify and hold Owner, its employees and agents, harmloss
under this Agreement for all claims, damages, costs or expenses caused by malfunction or
1
failure of the Facilities or any components thereof or other liability or loss including (njury,
death, or damages to any person or property related in any way to the performance of this
Agreement to the extent such claims, damages, costs, expenses, liability or loss are caused by
the negligent acts, errors or omissions of PeopleService, This provision shall survive the
termination of this Agreement.
ARTICLE IV -, COMPENSATION
4.1 As compensation for services rendered by PeopleService pursuant to this
Agreement, Owner shall pay to PeopleService the sum of $44,602 per month during the first
twelve (12) months of this Agreement, commencing with the Effective Date. The monthly
payment shall be due and payable on the first day of the month in which services are to be
rendered, All other compensation to PeopleService is due upon receipt of PeopleService's
invoice and payable within thirty (30) days of the date of the invoice.
4.2 The monthly compensation provided In Section 4.1 shall be adjusted on July I" of
each year, begInning on July It 2009. The basis for the annual adjustment for July 1 1 2009
shall be the change in the Consumer Price Index for All Urban Consumers CPI -U) as regularly
H: kwAyVs c n f (c tIO ts a g omp 6
C
reported by the U.S. Bureau of Labor Statistics, between April 2008 and April 2009. For each
year thereafter, the adjustment shall be the change in the CP W as reported between April of
the year preceding the year of adjustment and April of the year of adjustment. This annual
adjustment shall be done by letter acknowledging the change and will not require official action
or contract amendment.
4.3 Within sixty (60) days of the end of the first twelve months after the Effective Date of
this Agreement, Peoples ervice shall provide the Owner with a statement showing the amount
of money expanded on chemicals at the facilities. Should the amount of actual expenditures
for chemicals be less than the "base amount", PeopleService will include a refund equal to the
portion of the base amount that remains, If the actual expenditures exceed the base amount,
PeopleService shall 111CIUde an invoico equal to the amount actual oxpenditures exceed the
base amount, which the Owner agrees to pay in accordance with the terms of Section 4.1 of
this Agreement. The "base amount" for the first twelve montlis of this Agreement shall be
$60,000. The baso amount shall be escalated annually in accordance with Section 4.2 of this
Agreemetit.
ARTICLE V,- TERM OF AGREEMENT
M This Agreement shall remain in full fordo and effect for five (6) years from the
Effective Date. The Agreement shall be automatically renewed for successive tonins of one (1)
year each unless written notice of cancellation is given by either party to tho other no less than
ninety (90) days prior to the date of expiration.
ARTICLE V1 - TERMINATI
6.1 This Agreement may be terminated by either party in the event of the other party's
breach of a material term of the Agreement, by tho first party's giving written notice of such
breach and the second party's failure to correct within thirty (30) days of receipt of such notice.
6.2 PeopleService shall not be in breach under this Agreement for its failure to perform
its obligations under this Agreement, to the extent that the porformance of such obligations is
prevented or delayed by any event wh1oh is beyond the reasonable control of PeopleService,
including but not limited to Acts of God, strikes, labor diSPLItes, and unavailability of parts, In
H:vAvvA(scntrc110tsego.wpG a
the event PeopleService claims that its performance is prevented or delayed by any such
event, PeopleService will promptly notify Owner of that fact and the circumstances preventing
or delaying its performance..
ARTICLE V!1 -MISCELLANEOUS
7,1 Any temporary or portable equipment which is provided by PeopleService during the
term of this Agreement and which is not deemed part of the Facilities shall remain the property
of PeopleService upon termination of this Agreement. PeopleService shall not make any
expenditures for capital replacements of the Facilities or any component thereof without the
prior approval of Owner unless there is an emergoncy, An emergency exists when such
expenditures are necessary to continue operation of Owner's Facilities or to provide for public
health, safety or environmental protection. If there is an emergency, PeopleService shall
provide Owner with verbal notice of the need for the capital replacement expenditure as soon
rovi
as possible, Owner shall reiniburse PeopleSorvice for such emergency capital replaconlent
expenditures in accordance with Section 4,1 of this Agreement.
7.2 This Agreement represents the entire agreement of the parties and may only be
modified or amended in a writing signed by both parties.
7.3 Written notices required to be given Linder this Agreement shall be deemed givon
when mailed by first class mail to PeopleService, Attention: President, and to Owner, Attention:
City Administrator, at the addresses set forth for each in the opening paragraph of this
Agreement.
7A This Agreement shall be governod by, and construed in accordance with, the laws of
the state of Minnesota,
7.5 Neither party shall assign, in whole or in part, any of the rights, obligations or
benefits of this Agreement except to a parent, affiliate, or wholly-owned subsidiary, without the
prior written consent of the other party, which consent shall not be unreasonably withheld. For
purposes of this Section 7.5, an affiliate is defined as a company, the controlling interest in
H:vAvvAfscntrdk0tsego-wp6
which is owned by the parent of the party,,
7.6 Upon the Effective Date of this Agreement, that certain Operation and Maintenance
Agreement dated November 16, 2005 between the Owner and PeopleServs ce shall
8WOMatiCally terminate and shall be superseded by this Agreement.
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed as of
the date first above written,
PEOPLESERVICE, INC,
President
Attest: ��� � � � � h�"�
Secretary
H:%"wAfscnt(00tsego.WP6 10
CITY OF TSEGO, MINNESOTA
10,
A
-Mayor
do
iy AJA fi 1 sot"ra-4o r
OPERATION AND MAINTENANCE AGREEME
EXHIBIT A
Description of Facilj'WeS
For purposes of this Agreoment, the following water/wastewater utility components are
included:
9
IQ water systems,
The East water system is a Class "C" water system consisting of five (5) water
production wells [well #1, #3, 46 & 48 with submersible pumps; well #2 with a line
shaft turbine pump]; two (2) well houses with chemical addition equipment for
adding chlorine, fluoride and polyphosphate; two (2) elevated water storage towers
[tower #1 with a 400,000 gallon capacity and tower #3 with a 1 000,000 gallon
capacity); one (1) portable emergency generator; and a water distribution system
containing approximately 163,000 11neal feet of water mains of var'lous sizes (with
diameters of 6 to 16 inches), approximately 500 fire hydrants, three (3) pressure
control stations [station ##1 is a booster station while stations #2 & #3 are reduction
stations] approximately 1 000 water valves, corporation stops, city service lines,
curb stops,
The west water system Is a Class "C" water systern consisting of three (3) water
production wells [well fl4, #5 and #7 with submersible pumps], two (2) well hOLISes
with chemical addition equipment for adding chlorine, fluoride and polyphosphate;
one (1) elevated water storage tank with a capacity of 1 000,000 gallons; one (1)
15,000 gallon capacity hydro pneumatic water storage tank; one (1) portable
emergency generator; and a water distribution system containing approximately
163,000 lineal feet of water mains of various sizes (with diameters of 6 to 16
inches), approximately 600 fire hydrants, 1,000 water valves, corporation stops, city
service lines and curb stops,
H:%ANA1AfscnfrctXOtse9Q.wp6 11
Wastewater Systeras o
The east wastewater system is made up of a wastewater collection system that
contains four (4) lift stations [stations #1 & #5 are submersible triplex stations,
station 42 and #8 are duplex stations] approximately 115,000 lineal feet of
interceptor sewer lines of varying sizes (from 8 inch to 18 inch in diameter),
approximately 50,000 lineal feet of force main, approximately 600 manholes and
ten (25) air releaser anholes, and eighty (80) force main isolation valves; a Class
"All wastewater treatment plant containing pretreatment (a mechanical bar screen
and grit removal) and process treatment through extended aeration incorporating
specialized zones for nutrient roduction, with chemical addition available for
assisted phosphorous removal [process clarification occurs prior to disinfection and
reaeration]. Structures and equipment at this facility Include a control building with
laboratory/office area, control room and pump gallery (which contains three (3)
return activated sludge pumps, two (2) waste activated sludge pumps and two (2)
surnp pumps) and an attached pretreatment room with mechanical screening
oquipment and mechanical grit removal; two (2) oxidation ditches [ditch #1 uses an
aerator incorporating four (4) selector tanks with individual mixers, ditch #2 uses a
VFD controlled aerator based on an in line dissolved oxygen motor set point; ditch
#2 also Incorporates three (3) anaerobic tanks and an anoxic zone each containing
individual mixers]; two (2) final clarifiers; a chemical building for ferric chloride
addition for phosphorOUs removal; a blower building containing six (6) blowers [four
using variable frequency drives]; and a disinfection building using Ultra violet light
(UV) disinfection; and in line pH and dissolved oxygen monitoring; eff Went re-
aeration; one (1) aerobic digester with a decant tank; two (2) aerobic digesters with
decant piping,, five (5) sludge storage tanks; a sludge thickening building which
houses one (1) gravity belt thickener, a polymer injection/mixing system and a
pump room with three (3) progressive cavity pumps. The site also tinaintains a 900
KW emergency generator. The treatment plant has a design average dry weather
f low of 0. 900 mg d I an average wet weather flow of I -1 o rngd , a peak hourly flog
of 3.294 mgd and a G loading of 2,082 pounds per day.
H:vAvvAfscn1fc11O1sego.vip6 12
The west wastewater system is made up of a Wastewater, collection system that
contains five (5) lift stations [station #3 and #4 are submersible triplex stations and
stations #6 and #7 are su bmers-lble duplex stations], app rox! mately 110,000 11 neal
feet of Interceptor sewer linos of varying sizes (from 8 inch to 18 inch),
approximately 50,000 lineal feet of force main, approximately 600 manholes,
twenty -five (25) air release manholes and seventy (70) force main isolation valves,
and a Class "B" wastewater treatment plant containing pretreatment consisting of
mechanical screening and grit removal with process treatment accomplished
through extended aeration incorporating specialized zones for nutrient reduction
with chemical addition available for assisted phosphorous removal [process
clarification occurs prior to disinfection); strUCtUres at the plant include a control
building with laboratory/office areas and control room, a preliminary treatment
building with mechanical screenings removal, mechanical grit removal, and a pump
gallery containing three (3) return activated sludge pumps, two (2) waste activated
sludge PLIMPS, and two (2) sump pumps; two (2) oxidation ditches; three (3) anoxic
selector tanks for biological phosphorous removal; three (3) anoxic tank mixers; two
(2) final clarifiers; chemical addition for phosphorous removal; ultra violet light (UV)
disinfection; one (1) aerobic digester and decant pump; one (1) one million gallon
sludge storage tank and decant pump; a sludge thickening building which houses
one (1) gravIty belt thickener, a polymer injectiontmixing system, a pump room with
four (4) progressive cavity pumps and one (1) sludge storage mixing pump, a
chemical room for chemical addition phosphorous removal and a blower room with
three (3) blowers; and one (1) 600 KW stationary emergency generator, The
treatment plant has an average design flow capacity of 0.600 rngd with an influent
[BOD loading of 204 mg/l, influent TSS strength of 240 rng/L and phosphorous
loading of forty (40) pounds per day.
H:mwAfsontrctkO1seqO.wp6 13
OPERATION AND MAINTENANCE AGREEMENT
Services to be Provided- -by- —PeopleServicO
Except as otherwise provided in the Operation and Maintenance
Agreement, and subject to the limitations set forth therein, PeopleService
shall provide the following services to Owner in connection with the
Facilities:
PeopleService will provide the personnel necessary to manage, operate and
maintain tho City's water production, water treatment, water distribution,
wastewater collection and wastewater treatment facilities in order to achieve
optinium performance and to maintain equipment for system integrity, within the
Owner's budgeted resources.
PeopleService will provide technical training to the water and wastewater operators
on treatment process, preventive maintenance techniques, and safety awareness,
including the continuing education units (CEU's) necessary for the operating
personnel to maintain their licenses.
-PeopleService will procure and pay for all communication services including three
(3) phone lines and high speed Internet service (except for the alarm systems),
consumable supplies, chemicals, vehicle fLielS, and materials and services (E)XCept
the annual Genorator System Services, [no contract) necessary for the safe and
efficient day to day operations.
Monitor, sample, analyze, and report as required by the Minnesota Department of
Health (MDOH) in matters related to municipal water supply. Testing will include
those tosts necessary to maintain the daily operation of the water system and for
coliform bacteria. Any additional testing costs as required by regulatory agencies
such as but not limited to inorganic chemicals, synthetic organic chemicals, volatile
organic chemicals and pesticides will be the responsibility of the Owner.
H:m,xAfscnt(ctI0tse90-VIP6 14
PeopleService will mon vitor, sample, analyze, and report as required by the
Minnesota Pollution Control Agency (MPOA) and the NPDES permits issued for the
wastewater treatment faollifies, excluding the Priority Pollutants and Acute Toxicity
testing as defined in Chapter I of NPDES Permit MN 0064190. Testing will also
include those tests necessary to optimize and maintain the daily operation of the
wastewater treatment planLs.
PoopleService will act as a liaison betwoen the Owner and the MDOH/MPCA and
to the federal E.P.A. in matters relating to compliance with water quality and
discharge requirements, and other liaison activities, as required.
PeopleServico will be responsible for effluent qualify, including liability for fines and
civil penalties should permit conditions be violated, while plant loadings and flows
are within the design capability of the wastewater treatment plant, but only in those
situations where the permit condition could have been met using existing in-place
plant equipment.
PeopleService will coordinate and direct the -disposal of the bio-sollds from the
wastewater treatment plants (a properly certified operator will, on behalf of the
Owner, seek quotes from firms for theapplication of the blo-solids; will assist in
securing land application sites; and will oversee the actual application of the blo-
solids using the contractor selected by the Owner). Any cost of securing or
maintaining the land application sites and the cost of the third party contractor
doing the actual disposal work will remain the responsibility of the Owner. In
addition, PeopleService will maintain the required records for compliance with the
MPGA and 11503" sludge regulations.,
PeopleService will implement the use of a comprehensive, preventative
maintenance program in an attempt to ensure the projected life expectanGy of plant
equipment, and will enforce existing equipment warranties and guarantees, and
maintain all warranties on any new equipment purchased after the effective date of
an agreement,
H: VAWA fSIN. n t (C RO ES e 9 0 M06 15
With assistance from the Owner's employees, PeopleService will flUsh all fire
hydrants twice each year to maintain water quality in the distribution system.
Preventative maintenance shall be performed on all hydrants on an annual basis.
PeopleService will implement a water main valve exercising program that will
include the identification of valve locations in a "Tie Book" and the operation of
twenty percent (20%) of the valves each year.
01 Mth assistance frown the Owner's employees, PeopleService will implement a
sanitary sewer manhole inspection program that will include the identification of
manhole locations in a "Tie Book" and the Inspection of twenty percent (20%) of the
manholes each year.
■ PeopleService will complete all turn 'Ions" and turn "offs" of water service requested
by the Owner, but all other work with water nieters/service (such as bUt not limited
to high/low usage complaints, bulb water sales, meter installations, meter repairs,
etc.) shall be the responsibility of the Owner.
If repairs of the Owner's water distribution system or wastewater collection system
aro to be made, and excavation is required, PeopleService will coordinate the
repair Wing a contractor chosen by the Owner. The excavation, repair and any
surface restoration work will be the responsibility of the contractor, with the cost of
the contractor being the responsibility of the Owner.
■PeopleService will maintain cleanliness of process equipment and buildings, and
general appearance of all buildings and grounds, except for the mowing of grass
and will conduct operations such that nuisances of sight, sound, and odor are
eliminated or minimized to the extent reasonably possible,
Using a vehicle provided by the Owner, PeopleService will plow the snow at all
water and wastewater facilities, including lift stations, and when possible, will pull
pumps for necessary routine maintenance, repairs and inspections,
H:vwvAfscntrct\01sego-wp6 -16
I I M Within the limits of available security devices, PeopleService will secure and protect
-% utility facilities for which it is responsible.
M PeopleService will provide a monthly, written report to designated Officials of the
Owner, summarizing plant performance, production, flows, major projects or
accomplishments, and preventive and corrective maintenance activities for the
month.
PeopleService will comply with all applicable city, state, and federal laws,
regulations, and administrative rLI18S.
PeopleService will use a professional manner in dealing with community groups
concerned with any facet of the operations, including tours and other public
relations programs.
PeopleService will coordinate and cooperate with the Owner's Engineer and
contractors to facilitate the completion of any expansion orimprovement to the
facilities.
0 PeopleSeivice will serve as liaison between the Owner and any now or existing
Major contributing industries, and pro ride technical assistance to the Owner in
consultation to existing industries and to any new industries, in matters relating to
their pretreatment process, or agreements with the Owner and/or the MPGA.
IM PeopleService offers several types of professional services to our clients without
charge, We term these additional services as "value added" services that clearly
differentlate us from the typical O&M contract services provider. By providing these
studies, audits, and assessments, we hope to gain a firm knowledge of our clientis
systems and at the same time increase our value to them so that we are able to
establish a long-term, lasting relationship, The following lists our" alue added"
services, which we provide to our clients as part of out" support services package:
a Five Year Water/Wastewater Capital Improvements Assessment and O&M
KmAyVs entfollO ts eg osipO 17
L
Budgeting Assistance
Water and/or Wastewater Rates Study
industrial Pre -Treatment Investigation
Laboratory Quality Assurance and Quality Control (QA/QC) Program
- miso ellaneoLLs
A - PeopleService will provido the necessary information to complete all forms required
through the administration of the water and wastewater treatment systems. PeopleService will
not be required to pay any fees associated with the licenses or permits re Tired by the state
agencies. PeopleService will pay all expenses associated with the individual operator
certification.
B - PeopleService will not be responsible for any additional costs associated with any
construction project or upgrades involving the water and/or wastewater systems.
C - For services requested by the Owner and provided by PeopleService that are beyond the
Scope of services contained in this Exhibit B, (Peoples ervice shall charge the Owner at the
rate of $50 per hour between the hours of 8:00 as and 5:00 p.m Monday through Friday
(except for holidays). At all other times and during holidays, the billing rate shall be $75 per
hour. Hours billed shall include any required travel time. Owner agrees to pay Invoices for
said charges in complIance with the terms contained in the paragraph 4.1 of this Agreement,
H-vNNNscnVo1�0tsegomp13 18
FIRST AMENDMENT TO O&M AGREEMENT
WHEREAS, PeopleService, Inc., a Nebraska corporation (PeoploService ), entered into an
Agreement with the City of Otsego, Minnesota, dated June 9, 2008, for the management,
operation, and maintenance of the Owner's water and wastewater treatment systems (the
"Agreenient"),
lee,
WHEREAS, the Agreement was mouitfed by Letter of Acknowledgement effective July 1, 2009;
and
WHEREAS, the parties desire that the Agreement be amended to Include the sampling
requirements contained in the now permit issued for the east wastewater treatment facility.
NOW, THEREFORE the Agreement made and entered into between the City of Otsego,
'N.11 *.
Minnesota and PeopleService dated erne 9, 2008, for thew
managent, op"e�avo - ns, and
m a 1 nte na n ce of the Own e r's ter a n d wa stewtiter treatment Wed as system &- is a ni �follows:
1W Paragraph 4.1 is hereby amended to increase the tinonthly payment froom $44';290
to $44,435.
ts The first bullet on page 15 (Exhibit B, Scope of Services) is hereby deleted in its
entirety and will be replaced by the following'.
"PeopleService will monitor, sample, analyze, and report as required by the
Minnesota Pollution Control Agency (MPGA) and the NPDES port -nits issued for
the waste rater treatment facl I ities (Permit N o. X1 00 662 57 effective July 3 0, 2 0 0 8�
for the west treatment plant and Permit No. MN0064190 effective May 15, 2009 for
the east treatment plant Interlm period), excluding the Priority Pollutants and Acute
Toxicity testing as defined in Chapter I of PC ES Permit MN0064190, Testing
will also include those tests necessary to optimize and maintain the daily operation
of the wastewater treatment plants."
Except as amended herein, and as modified by the Letter of Acknowledgment dated June 29,
2009, the Operations and M aln ton ance Ag reennent entered into by the parties on June 9, 2008 ir,
hereby ratified and confirmed and shall remain in full force and effect in accordance with the
terms and conditions thereof,
This amendment shall be effective July 1, 2009, and is agreed to by both parties as evidenced by
endorsement below.
PEOPLESERVICE, INC.
By:
4
President-V1
Atteft�� ��' L�
kssist0t Secretary
OTSEGO, MINNESOTA
f ! � Ali' � ! �/
At
t
City ministrator
SECOND AMENDMENT TO O&MAGREEMENT
WHEREAS, PeopleService, [no,, a Nebraska corporation eo leS r ►io , entered into
n Agreement with the city of Otsego, Minnesota, dated Jure 9, 2008, for the
management, operation, and maintenance of the Owner's water and wastewater
treatment systems the "Agreement"),
VVHE EAS-� 1he Agreement was modified by Letter of Acknowledgement effective July 1,
2009 and was amended in writing effective July 1, 2009; and
WHEREAS, the parties desire that the Agreement a amended to include changes in the
services for the wafer distribution system, and wastewater collection system that are
provided by P e leS r ice.
NOW, THEREFORE the Agreement rade and entered into between the City of Otsego,
Minnesota and Pee leSer ice dated June 9, 2008, for the management, ement, o erati ns, and
maintenance of the Owner's water and wastewater treatment systems is amended as
follows;
Paragraph 4A is hereby amended to increase the monthly payment from
} $44,435 to$441820P
The Description of Facilifiles contained in Exhibit A of the Agreement is
hereby amended to include the instillation of SCADA equipment on Ilft
,stations Nos, 4, 6 and 7 in the west wastewater Ile ti n system, Owner,
hereby agrees that said equipment will he installed by June 30, 2010 with all
installation costs being the responsibility of the Owner.
The bacterial testing required as part of the fourth bullet on page 1 (Exhibit
Scope of Seri is her=eby amended to Include the seven monthly
tests (previous requirement was four) required as of the effective date of
this amendment,
`+ The third bullet on page Exhlhlt B, Scope of Services) is hereby deleted
ted
in its entirety and will be replaced by the following:
"PeopleService shall assist the Owner's employees in completing the
letting/vacuuming of at least twenty percent % of the Owner's
wastewater collection system each year, and as part of this work, shall
complete inspections of the manholes in that portion of the system. It
The fourth bullet on page 1 (Exhibit 13, Scope of Services) is hereby
deleted in its entirety.
Except as amended herein, and as modified by the C eater ofAcknowledgment dated JUne
29, 2009 and amended effective July 11 2009, the Operations and Maintenance
Agreement entered into by the rtles onJune 9. 2008 is hereby stifled and confirmed
and shall remain In full force and effect in accordance with the ternis and condiflons
It
thereof,
This arnendme nt shal I be. effective April 1, 2010, an d is agreed to by both parties as
evidenced by endorsement below,
PEO'PLEBE RVICE, INC.
BYE
President
Attest:
Assistant Secretary
OTSEGO, MINNESOTA